Darden Restaurants Increases Dividends by 16 Percent

Darden Restaurants reported a 15 percent increase in fourth quarter EPS and increased its quarterly dividend by 16 percent.

The Orlando, Florida based company operates 1,994 company owned restaurants including the famous Olive Garden, Red Lobster and LongHorn Steakhouse. In the fourth quarter, U.S. same-restaurant sales increased 3.0% at LongHorn Steakhouse and declined 1.8% at Olive Garden and 3.9% at Red Lobster.

Total sales from continuing operations for the fourth quarter were $2.07 billion, a 3.8% increase from the $1.99 billion last year while net earnings were $151.6 million compared to $138.0 million.

The Speciality Restaurant Groups fourth quarter sales of $179 million were 26.9% higher than the prior year, driven by same-restaurant sales increases of 2.8% at The Capital Grille, 2.8% at Bahama Breeze and 1.9% at Seasons 52.  The company added two new restaurants at The Capital Grille, four new restaurants at Bahama Breeze, six new restaurants at Seasons 52 and the addition of 11 Eddie V’s restaurants purchased on November 14, 2011.

For Fiscal year 2013 the company expects same-restaurant sales growth for the year at Olive Garden, Red Lobster and LongHorn Steakhouse of between +1% and +2% and plans to open approximately 100 to 110 net new restaurants.

Darden Restaurants is the world’s largest full-service restaurant company employing 180,000 people.

The following hedge funds hold a net long position in DRI:

1. Diamondback Capital – Richard Schimel: 253,089 shares

2. Scopus Asset Management – Alexander Mitchel: 199,700 shares

3. Adage Capital Management – Phill Gross And Robert Atchinson: 181,769 shares

4. Jabre Capital Partners – Philippe Jabre: 165,000 shares

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